TaxTMI 
TaxTMI 
2025 (7) TMI 2009
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....s. Hyundai Motor India Ltd., (HMIL) for sales and services of passenger cars as per the agreement entered into with the manufacturer of cars. The Commissioner in the impugned orders have confirmed the demand of service tax under 'Business Auxiliary Service' observing that the appellant was promoting and marketing the sale of the cars manufactured by HMIL and the incentives/commission received by them was for undertaking business promotion activities. Aggrieved by these orders, the appellant is in appeals before us. 2. The Learned Counsel on behalf of the appellant submits that the dealership agreement entered into with HMIL is on principal-to-principal basis and as dealers they become eligible for discounts on all models of cars on achie....
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.... Service'. This Tribunal in a similar set of facts in the case of Bangalore Motors Pvt. Ltd. Vs. CCE: (2024) 22 Centax 411 (Tri.- Bang.) has held as follows: "9. The issue is no longer res integra and as referred to by the Learned Counsel for the appellant the same has been considered and decided in favour of the assessee in the following cases : (i) Rohan Motors Limited v. Commissioner of Central Excise [2021 (45) G.S.T.L. 315 (Tri. - Del.) = [2020] 122 taxmann.com 24 (New Delhi - CESTAT) (ii) T.V. Sundram Iyengar & Sons Pvt. Ltd. v. Commissioner of CGST & C. Ex., Madurai [2021 (55) G.S.T.L. 144 (Mad.)] (iii) B.M. Autolink v. Commissioner of Central Excise [2022-VIL-900- CESTAT-AHM-ST] (iii) Ros....
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....e discount to the dealer, this discount is nothing but a discount in the sale value of the vehicle sold throughout the year therefore these sales discount in the course of transaction of sale and purchase of the vehicles hence, the same cannot be considered as service for levy of service tax." 11. The Larger Bench of this Tribunal in the case of Kafila Hospitality and Travels Pvt. Ltd. (supra) dealt with the issue whether service tax can be levied under the category of 'Business Auxiliary Service' on target based incentives paid to the travel agents by the Airlines as they were promoting and marketing the business of the Airlines. The Tribunal took the view that it is not a case where the air travel agent is promoting the service o....
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....t is reproduced below :- 53. On analysis, the so-called supplies for consideration identified by the Commissioner are nothing more than the encouragement of an overall business relationship between the manufacturer and the dealer to the mutual benefit of both. The relationship involves a whole raft of obligation from one to the other all, presumably, with the ultimate objective of maximizing their respective commercial positions. As the A.P. Group put it, the overall relationship contemplates a continuing dialogue between wholesaler and retailer in which promises are routinely exchanged, but to characterize this dialogue as involving supply after supply is unrealistic and impractical. To characterize the payment of the incentives i....
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....L is engaged in manufacturing, marketing and selling of motor vehicles and the appellant purchases the vehicles from the manufacturer as their authorised dealer on principal to principal basis. The relevant clause is quoted herein below : "C. MSIL having considered the representations made and the application submitted by the Dealer agrees to appoint the Dealer as the Authorised Dealer. It is made clear that MSIL would sell the products and parts to the dealer on principal to principal basis. The dealer would sell the products and parts and would provide service to the customers (which would include, but not be limited to, the service in terms of the warranty as per the owner's manual provided by MSIL from time to time) which promo....